Delhi Model: When good governance and trickle-up economics merged | M.R. Narayan Swamy

BOOK REVIEW
 

The Delhi Model: A Bold New Road Map to Building a Developed India

by Jasmine Shah

Penguin/Business; Pages: xxii + 334; Price: Rs 799

The Delhi Model of governance that was spearheaded by Aam Aadmi Party (AAP) founder Arvind Kejriwal is often characterised as an exercise in freebie politics, particularly by the Bharatiya Janata Party. Nothing could be farther from the truth.

By the time the AAP stormed to power in February 2015 with a brute majority, Kejriwal, an IIT engineer-turned-IRS officer-turned-rights and political activist, had refused to believe that governments in India cannot deliver world-class outcomes. Of course, naysayers were aplenty. A section of Delhi’s elite parroted that Kejriwal was too anarchist and inexperienced in running a government. Even a section otherwise well-meaning people saw naïve idealism in his ideas and ambition.

Amid the negativity surrounding him, Kejriwal – who rose to prominence due to the Anna Hazare-led “India Against Corruption” movement – was clear about what he wanted to achieve. But he shunned all talk of ideologies. This led to criticism from a section of the Left that minus a clear ideological stand, he would not succeed vis-à-vis the ordinary masses.

Like the author of this path-breaking book, Jasmine Shah, another IIT product and a Fullbright-Nehru Fellow from Columbia University, Kejriwal understood that lack of technical knowhow was not the reason behind governance failures. The real reason was a failure of policy imagination and political will. In his own way, he with his colleagues birthed a unique model of governance, “one that wasn’t about fixing a specific set of issues but about fixing how governance itself worked in India”.

Kejriwal shunned, unlike most chief ministers, all talk of attracting huge investments and building shining new infrastructure. Instead, he prioritized investments in building human capabilities and improving the quality of life of the middle classes and those at the bottom of the fiscal pyramid. He was also clear that corruption must be crushed since it ate into budgets (limited in states) and compromised the delivery of people-oriented schemes. Finally, such a model could only succeed only if there was fiscal prudence, with budgets growing on the back of a healthy state economy without pushing the state into a debt trap. Most remarkably, Kejriwal succeeded on all three fronts.

For the first time in India’s history, the AAP government allocated nearly 40 percent of its annual budget to education (25 percent) and health (15 percent). These two subjects were at the forefront of the party’s campaigns too – and were areas where the Delhi government won national and global acclaim.

Compared to 24,100 classrooms built in Delhi’s government schools since India’s independence, Kejriwal’s government constructed 22,700 classrooms in nine years. This amounted to adding a whopping 613 new schools. All government schools were renovated with tiled flooring, clean and functional toilets, modern libraries, science laboratories, air-conditioned auditoriums, well-lit classrooms and designer desks. Some schools even got swimming pools as well as football and hockey turf grounds. In other words, dignity was returned to the capital’s much-neglected government schools.

The AAP also invested heavily in empowering principals and teachers. This wasn’t easy as decades of shabby treatment by successive governments had left them thoroughly demoralised. Indeed, when Manish Sisodia appeared on the scene like a devil possessed, he was initially taken as another politician who would grab a few headlines and then fade away. Parents of the mostly underprivileged children in government schools were made active owners in education through school management committees, which enjoyed enormous powers. Schools of specialised excellence too came up. 

The most visible impact of any school system is the Class X and XI board results. The reforms delivered results. In 2015-16, for the first time in Delhi, government schools outperformed private schools in class XII results. This trend continued for next nine years barring 2022-23. Similarly, the pass percentage of class X results improved steadily to 94.2 percent in 2023-24, reducing the gap with private schools to just 1.5 percent in 2023-24. Total student enrolment shot up from 15.4 lakhs in 2014-15 to 17.2 lakhs in mid-2024. And 2.2 lakh students left private schools to join government school over a decade.

The number of government school students who passed JEE mains zoomed from around 50 in 2013 to 783 in 2024. The “happiness classes” motivated 200 private schools in Delhi to implement them. “Business Blasters” became the world’s biggest start-up programme for school students, with a budget of Rs 60 crores for 3 lakh students in more than 1,000 schools. Such was the all-round success that 20 states sent delegations to study the education model, including from BJP-ruled Assam, Gujarat and Madhya Pradesh.

How did the AAP become the unlikely architect of a healthcare guarantee model unheard of in India? One reason was that it was piloted by a soft-spoken architect-turned-political activist, Satyendar Jain. Over the past decade, no healthcare movement in India has been nationally and globally celebrated as much as Delhi’s simple Mohalla Clinics. So much so, seven states in India have copied the concept.

As of early 2024, some 450 Mohalla Clinics were operational in Delhi, serving an eye-popping seven crores of out-patient visits. Some 60,000 patients were served daily. The clinics, set up at meagre cost, provided free consultation, tests and medicines for all minor ailments and common long-term diseases including diabetes. The number of Delhi government hospitals and beds went up from 37 and 9,523 in 2015 (after seven decades) to 40 and 13,708 respectively in early 2024 (nine years). Another 25 projects with 14,000 beds are under construction.

In 2017, Delhi became the first state or UT in India to assure absolutely and unbelievably free treatment to every citizen for any ailment, irrespective of the cost, within a guaranteed time frame. Thirty polyclinics also came up. Irrespective of their residential status, any road accident victim in Delhi became eligible for cashless treatment at any private hospital of his/her choice, with the cost borne by the Delhi government.

Shah’s book details the many other achievements of the Delhi model but only a few can be highlighted here. Free water was provided to every household for up to 20,000 litres a month. Over 5,200 km of water pipelines were laid, increasing the share of unauthorized colonies having access to piped water supply from 54 percent in 2015 to 99.6 percent in 2024. Another 2,100 km of water pipelines were laid for rural areas and resettlement colonies. Put together, the government installed some 1,000 km of water pipelines every year in the national capital. Unauthorized colonies got 4,400 km of sewer lines, increasing the coverage from 13 percent in 2015 to 57 percent in 2024.

The Delhi government became the first in India to ensure 24x7 power supply. From 2019, it started providing free electricity up to 200 units to every household and 50 per cent subsidy on bills between 200 and 400 units. This too was an election promise. Solar and renewable energy in Delhi’s installed power capacity went up from virtually nil in 2015 to one-third by mid-2024.

Delhi became the city with the largest fleet of public buses as well as electric buses throughout India. The public bus fleet rose from 6,100 buses in 2015 to 7,700 in mid-2024. By 2025, this would increase to 10,480. The AAP government in 2019 became the first in the world to make bus rides free for all women – a decision first derided by all political parties but later adopted by several Indian states. As of early 2024, women in Delhi, mainly from economically depressed classes, had availed almost 170 crores of free bus rides.

All these leapfrogging steps – free bus travel, free and subsidised electricity, free water, free education and grand schools, as well as free healthcare – helped millions in the capital to save thousands of rupees, winning for the AAP a substantial support base.

While avoiding ideological jargon in its political language, the AAP was very clear that the so-called ‘trickle-down’ economics doesn’t work for the people. This is why while India has recorded a sustained GDP growth post-liberalisation, inequality has worsened and human developmental indicators are dismal. While the Modi government has reduced corporate tax, banks in the past one decade have written off Rs 15 lakh crores of bad loans of rich corporates. All these were nothing but freebies for the big capital.

In contrast, the AAP argued that economic and social policies need to be directly aimed at those in the middle and lower classes to increase their wages and earning capacity. If there is no demand for goods, even the best entrepreneurs won’t make investments. Indeed, the AAP policies directly improved the spending power of Delhi’s poorest. Almost 76 percent of the families benefitted from zero water bill, 65 percent from free treatment in government hospitals, 8 percent from free bus rides and 44 percent from free public education. According to Shah, if one adds up these savings for the entire population of Delhi, this increase in disposal incomes translates to an additional buying power of over Rs 10,000 crores per annum in 2020 – a staggering value.

As Shah points out, the AAP’s economic model isn’t opposed to capitalism or private enterprise but one that opposes giving excessive concessions and dole outs to a chosen few in the private sector at the cost of others.

None of these came about easily. Right from the word go, the Modi government put innumerable obstacles; over time, it simply choked the Kejriwal government in more ways than one. The AAP government was also not successful everywhere. Even in areas where its success was widely accepted, issues remained. One of Kejriwal’s achievements was maintaining fiscal prudence.

Yet, despite all these successes, the AAP government lost the Assembly elections in 2025. The reasons are long and are closely linked to the Modi government. Shah goes into how the Centre dismembered the Kejriwal government. But that is another story. Keeping aside the Delhi election outcome, every student of politics and economics must read this book.